There’s a new process available for Community Associations to get delinquent dues paid without any out of pocket expense; and where associations receive 100% of their collected dues. It’s also a new revenue stream for Community Association Management firms (more on that another time).
This process utilizes all of the elements of traditional collections; but with some important differences. For instance, delinquent homeowners are instructed to pay your association’s management firm or agent directly. That’s because the last thing homeowners want to do is to pay some collection agency. When a collection agency demands homeowners pay that agency, it causes ‘payment friction’; putting a barrier up that reduces homeowners’ willingness to get current. Homeowners are more comfortable paying your management firm directly; it also makes your funds immediately available.
(image: ShutterStock)
Never Pledge or Assign Accounts
Another important difference is you never have to assign or pledge the ownership of, or the rights to your association’s accounts. Signing over even partial ownership of your accounts is a major mistake. Suddenly you have a third party potentially putting your homeowners in uncomfortable positions or being abrasive with them, which can only come back to bite your board. Such agencies may bury your neighbors in fees, and even rush them to foreclosure just to get those fees – which can make for some very unpleasant board meetings. Even trying to do a short sale can get complicated and suddenly become a nightmare. Never sell out your neighbors to strangers.
So How Does This No Cost Process Work?
It's a very simple and effective process. First, a low fee is added to each delinquent balance – putting the onus of the cost to collect where it belongs. This covers our collection service, which includes: retrieval of homeowners’ social security numbers or birth dates (a new NCAP requirement), skip tracing (acquiring members’ best contact information), letters, phone calls, and credit reporting.
Which brings us to another important distinction. The consequence of credit reporting is withheld until the end of our collection process. Homeowners are only reported to Experian, Equifax, and TransUnion if they don’t pay their dues to your management firm within a reasonable period of time; say 100 to 120 days. They’re reported as a collection account, which stays on their credit for seven years until it’s paid.
We only receive our funds when your members pay their delinquency. There are no contingency or recurring fees or any out of pocket costs for your Association.
With our service, phone calls from our collection counselors simply communicate to homeowners the need to resolve delinquencies so they can avoid being credit reported. It’s a more neighborly approach.
You’ll usually collect over half of your delinquent assessments with our process. What isn’t collected you can then send to your association’s attorney to pursue through legal course.
In today’s complicated world of running an HOA or condominium association, the perplexing dilemma of trying to collect delinquent dues finally has an effective, no-cost option available for board members. A simple solution which clearly communicates the effective motivation of being credit reported and ensures your association gets 100% of its collected dues. All with a very high success rate.
Click here for more details, testimonials, and insight into this simple solution.